5 Retailers With Impressive Same-Store Sales Growth

Whether it is the growing threat of online retailers, the difficult task of managing inventory, or fickle consumer tastes, the retail industry is highly competitive and increasingly tough to win in these days. This can make it challenging for investors to choose winning retail stocks. That's where same-store sales come into play. Tracking a company's same-store sales is especially important when evaluating retail stocks because it measures sales growth at stores open for more than a year. Same-store sales are often called comparable-store sales or comps.

Looking at same-store sales helps investors gauge how well the business is operating at existing locations, unlike revenue growth, which can be misleading because a company can achieve this by opening new stores. It's in this spirit that I've listed below five retailers (in no particular order) that are dominating today thanks to strong same-store sales growth.1. Michael Kors Luxury retailer Michael Kors earned the reputation of a Wall Street darling thanks to its stellar same-store sales growth over the last several years. Kors has delivered year-over-year double-digit comparable-sales growth for the past five years. It's true that the retailer's quarterly comps have settled down a bit lately, particularly in North America. However, they are still growing. During the company's recent third-quarter, for example, North American same-store sales increased just 6%. Yet, this weakness was offset by strong comps in overseas markets such as Europe and Japan, where same-store sales grew more than 21% and 35% in the period. KORS shares currently trade around $62 apiece or near its 52-week low.

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2. Starbucks Specialty coffee retailer Starbucks gets top marks for many reasons, but its reliable same-store sales growth is what really stands out among competitors in the restaurant space today. Starbucks has generated comps increases in each of the past five years. In fiscal 2014, the company reported same-store sales growth of 6% in its Americas segment with a 7% increase in its China and Asia Pacific markets. For comparison, Starbucks' closest competitor, Dunkin Brands , posted less than a 2% increase in U.S. same-store sales and a decline in international comparable sales over the same period.

Starbucks expects the good times to continue as management predicts mid-single-digit comparable sales growth for fiscal 2015. Shares of Starbucks are currently trading around $49 a pop or near the high end of the stock's 52-week range.

3. Costco As a warehouse retail chain, Costco is rewarding shareholders with steady returns thanks to the ongoing success of its membership fee model. The company has driven year-over-year comparable-store sales gains in each of the past five years both domestically and abroad. Costco has achieved this by not only increasing the number of times members shop its warehouses but also by getting guests to spend more at each visit. Last year, the warehouse giant posted same-store sales growth of 4%. Moreover, Costco should be able to average 5% comps growth from its current fiscal year through fiscal 2024, according to data from Morningstar. Shares of Costco are currently trading around $144, or 7% below the stock's 52-week high.

4. L Brands If the name L Brands doesn't sound familiar, you probably know the businesses under its umbrella -- names like Victoria's Secret, Bath and Body Works, and Express. The company has enjoyed positive comps in each of the past five years, with 4% same-store sales growth in fiscal 2014, up from 2% the prior year. L Brands celebrated record results last year with its two top brands delivering strong same-store sales growth.

Victoria's Secret, for example posted comparable-store growth of 3%, driving full-year net sales to $7.2 billion. Bath and Body Works, meanwhile, saw same-store sales increase as much as 6% in fiscal 2014, pushing net sales north of $3 billion. Given the strong brand recognition of L Brands' top franchises, the company should have no problem maintaining same-store sales growth in the quarters ahead. Shares of L Brands are currently trading around $90 apiece or just 5% below the stock's 52-week high.

5. Home Depot Home improvement giant Home Depot is another big winner when it comes to ballooning same-store sales. The company has achieved comps growth every year since 2010, driven by both a spike in customer transactions as well as increases in the amount of money consumers are spending per visit. Home Depot grew its same-store sales by more than 5% in fiscal 2014, which was a decrease from comps growth of 6.8% the prior year, but growth nonetheless. Home Depot should be able to generate sales growth of 5% in fiscal 2015, according to data from Morningstar. Shares of Home Depot are currently trading around $108 a pop or near the high end of the stock's 52-week range.

When it comes to evaluating retail stocks, same-store sales is a key metric giving you insight into the health of the business. As the five stocks above demonstrate, finding companies with long-standing comparable-store sales growth is a great way to unlock superior shareholder returns for years on end.

Tamara Rutter owns shares of Starbucks. The Motley Fool recommends Costco Wholesale, Home Depot, Michael Kors Holdings, and Starbucks. The Motley Fool owns shares of Costco Wholesale, Michael Kors Holdings, and Starbucks. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.